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This article presents the results of a study of the impact of an increase in coinsurance on the demand for outpatient mental health services. The study population was a set of fully employed subscribers enrolled in the Blue Cross and Blue Shield Association's Federal Employees Health Benefits Program at some time during the period 1979 through 1981. A two-part model was used to examine the determinants of both the probability of mental health service use and the level of use. Our results indicate little price sensitivity in either part of the model, but substantial and significant income elasticities. Our results concerning the role of various sociodemographic and environmental variables are also reported.